The Goal of Inventory Control Is To

question 48

Multiple Choice

The goal of inventory control is to:

• A) minimize inventory levels while maintaining an adequate supply to meet customer demands
• B) maximize inventory levels to prevent any possibility of stockouts
• C) determine order timing and order quantity
• D) estimate proper usage rates
• E) integrate JIT to reduce risks of obsolescence,theft,and damage

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Definitions:

Compensating Balance

A minimum bank account balance that a borrower must maintain as a condition for some types of loans and lines of credit.

Effective Annual Interest Rate

The interest rate that is adjusted for compounding over a given period. Essentially, it reflects the total interest that will be paid or earned over a year, taking into account the effect of compounding.

Inventory Turnover Rate

A financial metric measuring how often a company's inventory is sold and replaced over a period.

Sales

The total amount of goods or services sold within a specific time frame, indicating the performance and growth of a business.